Transcript
A (0:07)
You've had a dynamic where money's become freer than free. If you talk about a Fed just gone nuts. All, all the central banks going nuts. So it's all acting like safe haven. I believe that in a world where central bankers are tripping over themselves to devalue their currency, Bitcoin wins. In the world of fiat currencies, Bitcoin is the victor. I mean, that's part of the bull case for bitcoin. If you're not paying attention, you probably should be. Probably should be. Probably should be.
B (0:36)
Well, it's been about a year since we caught up and you probably do need security guards with guns now because the metals complex has had one hell of a run. Silver just this morning went over 100. Hit, hit over $101 at some point. Colds approaching 5,000. And I had to reach out to you because as I was saying before we hit record, I'm convinced that those in the know of what's going on with the metal flows know the actual story of what's going on because it seems pretty big right now. And so without asking any leading questions, I guess just jump into it.
A (1:14)
What.
B (1:14)
Have you seen what is going on with the, the metals complex as it stands today?
A (1:20)
Yeah, I would say, I mean, clearly we could talk about all the monetary reasons, the expansion of debt, all those things that are really taking place. And frankly, what started really around the time of the Ukraine war, I think it set the stage for what we're seeing here, which is a exit of globalism and trade relationships which are not just broken, but we're now in war over, over resources. And then the resources that are critical to the future related to energy, AI power and military are forefront. And you kind of put all those things in together where people all want the same asset at the same time. That's, that's what an auction does. If two people want to buy something and they're willing to pay a higher price to get it, that auction goes up. Well, if you're lucky at an art auction or you're on ebay and you're the only one bidding prices, prices lower. So it's a situation, you know, really what's happened. It's just, you gotta, it's a geopolitical. And so I've been talking about as it's a metals war. It was right around, I'm actually flying out to, to Europe on Sunday here a couple days. I think it was, I was coming back. I think I had, I had a hat on. I think some people are like oh man, you're not very professional. I was like man, I'm on a 10 hour flight like you know, coming back from Europe and I just put a hat on and I start talking about what was happening and it was the gold moving to the US and, and I kind of started to put together the, the my, a little bit more of my macro thesis of, of what, what was going to happen and a lot of it is why I moved my, my what's now Scott, still mint. I moved, moved from Arizona over 18 years ago. I founded it, I moved it to Wyoming and then I started another company called the Wyoming Reserve which is a tax advantaged foreign trade zone vaulting operation. And you know, when you have the macro thesis and you see the chips change, I, I love to put, put things on the board and you move things around. And I started just talking about what I'm seeing unfold and you know, really what we've seen, you know, kind of fast forward a little bit here with, with silver that we'll cover really is China, it's U S banks, it's US Government, that's what's driving, that's what's driving the, the numbers right now. But I also think it, it started the Ukraine war when assets were seized. So and I think this is even interesting in the digital sphere because I, you know, is what is feasible and what is not. And so when, when Russia's assets, when we're talking balances at, at you know, the bank of England, whether that was physical gold, whether that was fiat currency, whether that was some oligarch's boat like in a different port, you know, the assets were seized and I really think most of the brics nations looked at that and says well if that can happen to them, that can happen to us in you know, if we look at the Ukraine war, it's, it's clearly a, a proxy because there's, it's, it's just, it's just there's not a lot of movement. It's just there's unfortunately a lot of death and money and money laundering and, and stuff. But China is really the one behind it all, behind Russia because if, if, if Russia were to fall, China's now next. And so Trump's tweet was December right around Christmas of 24. He, he hadn't taken office yet. He'd want just won the election. He gave a, oh gosh, sorry, my phone wasn't turned off. He gave a really interesting tweet out and I don't think it was properly covered he said, warning to the bricks, don't start a new currency and don't back it. And I think we could all get our heads around, okay, the BRICs might want to try to create a competitor to the US Dollar. I think we can all get around that. But I don't think people pay attention to what he meant by back was gold. And so at that time and what that means historically, if you think about it, whoever holds the most gold essentially has made all duels. This is just throughout history. I mean it's, this goes back thousands of years. And then after World War II, even gold is the settlement layer for the debts of everyone. And that's why bank of England has held all the gold over the last. For decades it's had the most gold in the world. And now even, even countries will pledge some of their gold as loan facilities through the World bank for developing countries. It's very much part of the financial system. Then you have this beast, China, whose military and economy has been growing decade after decade saying, hey, we want our gold in China. You don't want it there. And so that had been going on for a few years under, when Biden was there and no one was really paying attention. What I don't think people were also paying attention. And I came from the risk management side in the mining industry, so have done some corporate risk management work in mainly not just the US but Latin America, a little bit in Africa. So I'm pretty aware of resources and companies and traditionally I would say it was the U.S. canadian mining companies and Australian mining companies were kind of some of the biggest players in that arena. China over the last 20 years did a really good job of getting in, in particular into Africa. And they start cutting deals and they said, hey, we'll build you an airport, we'll build you schools, we'll build you a port. If you let us access, to develop this, mine it to do to or access food. Because I mean China is just this massive machine. So really. And now we're starting to see the, you know, these, these military coups in, in, in Africa that are probably going to pick up. Like who are they aligning with? You know, are they. You know, unfortunately, Africa is a playing ground of resources and, and you know, throughout history and it's just a mess of massive problems, but China mopped it all up. And so I think what happened was Trump administration came in and you can even go back to his first term. One of his biggest things he was worried about was computer chips and says, hey, what happens if we lose Taiwan. So he decided to help bring, you know, two massive Taiwanese companies into Arizona. So there's two multi billion dollars one's on the north end of the town of the valley and one's on the south. And so here we are, many years later. I don't even think they're, they're not fully online yet, but it takes that long to develop. But I mean, at some point I think we can, Here we are in 2026. This could be a year Taiwan could go down. It could, it's, it's definitely not a zero percent chance of anything. It's probably going up. And so I think the Trump administration immediately. And I, and I felt that I saw it because I work with the banks, I work with some, some, some government work. I see metal movement and flow and I'm like, the amount of material. And it started with gold coming to the US it was under the guise of, it was tariffs. The tariffs are coming. But if you're a country who is lacking in something, who needs something, are you going to put a tariff on that if you need it for your manufacturing? No, you tariff other things. And so all this material was coming to the US but it kind of felt like to me, it was so big, it was bigger than a bank, it was bigger than a company. And it was so disruptive to the London market that they were having gold delivery delays right around this time last year into that first, late into the first quarter. If anyone is that disruptive into the financial markets, you get on the knock, you get a knock on the door by some agency, Commodity Futures Trading Commission. It happened to George Soros in the 90s, it happened to Warren Buffett. No one is immune. They both try to corner silver, by the way, or not corner it. They took too big of a position, which kind of get into what's happened today. So if somebody is buying this much gold and it's disrupting the market and London's panicking, but no one's getting a knock on the door. It's gotta be the federal government. That was the same time Elon Musk was saying, hey, back when he was doing Doge, he was like, let's audit or Knox. Trump says, hey, let's have a look. Now, we haven't heard anything since then. And I think probably my last podcast I said my take would be, is it good chance it was pilfered? Right. Over how many years? It's not been audited in 50 plus. Some people might say, we don't need it. It's there. We Just tell you it's there. Who knows? Who knows what? I mean, we have seen so much government waste, you know, the daycare stuff. Our politicians, unfortunately, on both sides of the aisle are known to spend money or take money or line their own pockets. Unfortunately, maybe not all of them, but. So who knows what, what took place? So, so that, that started early, you know, early 25, I mean, right. It almost felt like it was, it was almost as if his, his team was already in contact with the banks before he took office. It was so coordinated. It was so big. And then when he took office, immediately the tariff agenda hit, you know, heavy. Early early 25. And then it kind of came down into what's going to be tariffs, at what rate and who are we going to do it to. And we're still having this topic that's, it's really not going away. And then comes up this whole critical minerals topic. And let's do a review. What's critical to the infrastructure of the United States? So kind of going back to the, the knowledge of like, so if you think you need computer chips for your economy years ago, what about medicine? How much medicine is made in China and India? Where, where does, where does the US Get? It's pretty much everything. It's made those two places. And I do believe that this administration is taking its future a little more serious than previous administrations. And that goes back, you know, probably, probably decades. And, and it's also because we, the US has been beat up, you know, fleeced. Europe is fleeced, and look at Europe now is a hot mess in so many different ways. So you, you think about, if you're saying, hey, we lost out on Africa for the most part, we need to lock down the Western Hemisphere. And I actually was putting that kind of in. In motion. North and South America. And I do a lot of work with the Caribbean central banks. And I started noticing and I'm down. Unfortunately, I have to go to places like the Cayman's, Saint Kitts because we meant a lot of their gold and silver coins. And I'm noticing military increases down there. And without saying too much, I started to realize they're doing what the Chinese have been doing, which is cutting deals, making sure they're aligned with what's going on in the region. And I would say for the most part, you would say the Caribbean definitely is heavier, US Centric, just historically. However, there's a few islands, there's a few places where the Chinese were building ports, they were building hotels, they were doing different things that you go, okay, Maybe it is benign, but that's influence, that's influence over know, who knows what. And then we watch, you know, suddenly second half of the, of 25, the, the US's military presence is increasing and they started in southern Caribbean really heavily. And then obviously we just took out the Venezuelan leader just a few weeks ago at the snap of a finger. And I feel like that's, that's just the start of Latin America. To me, it's going to go all the way down. And what I've been talking about, why silver is going up so hard, really, really cents around than doing so you had, I don't know if you were aware, most people were either sleeping in after their Thanksgiving Day or they're out shopping Black Friday or who knows, the Comex was shut down for a piece of Black Friday. There was a server error, the cooling room wasn't working, so they had to shut down gold and silver trading. And you know, I'm making calls, what's going on? No one had ever seen it. It didn't make a whole lot of sense. But what we did notice is there was a huge request. What we did notice is someone, someone had put in a request of withdrawal for so many ounces of silver that it was almost like, is this a mistake? And I think it was, don't hold me to it. I think it was like, almost like a third of the silver that was in New York was requested. And then suddenly the thing freezes, it started back up and they shut down options tradings, everything shut down. Then suddenly, you know, it comes back. Then Monday morning, there's no withdrawal requests, it's gone. And everyone's like, it must have been sort of a mistake. We don't know. My personal take is it was the Chinese. They were either testing our markets or just wanting a lot of it in one shot. And I'm guessing whether the US government was directly involved, the banks were, and I think it was J.P. morgan. And they probably said, hey, you can't take it from us, but we'll get it for you in other markets. And at that, right at that point, look up the price like we were in the 50s here, we've doubled. I mean, for silver to double in less than two months. This is historic. And it's not even that volatile. It's just like every day, every day. What I actually think has happened, and I, I've been talking, I've been talking about this, is that the JP Morgan owns and controls the largest stockpile silver in the world. A lot of people say oh well, they're always short. Well if you have inside knowledge based on someone who calls you that someone's a big buyer, could you flip your position in a moment's notice? Banks are profit centers. So I think what they did was so we called in the industry, they threw a blanket over all their inventory and said none of this is for sale. And then they went long, you know because they, they, they're always using, you know, whether doing covered calls, just outright hedges. And then these banks also control the mines that they're buying financing the mine, the material. So, so a lot of times people say oh well that bank is net short. But they actually bought the, they bought pre production ounces that are coming out of a mine every month. So it's really just, maybe they're just hedging and they're not, it's not a naked short. So there's a lot of misinformation out there. And now this new AI slop on, on X and YouTube is just, there's so much, it's all like half truths and information and then you've probably seen it and on all sorts of topics. So yeah, that, that took place. And I, and I do think that Chinese are, China is the highest level but also India and I'll get into why are they buying so much metal is going back to the military. The US is restricting or the ship. So we heard about members tankers were being seized from Venezuela. Because it's not just oil. We have plenty of oil. Oil is important. Absolutely. That's a metric. But there's no doubt that Latin America is where most the precious metals. That, that, that, that's, that that's a huge piece of it. So a lot of that what's called concentrate. So when you, you typically a typical mine either produces something like, think like a 40% grade. Some of them can internally do and produce something. Maybe if they have an on site small smelting operation they can get it to a doorway which is more like a 90% concentrate. So the refineries in the United States are only, they can't take concentrate because of EPA rules. So smelting is basically just think like burning, you're basically burning rock. You're, you're burning it to separate the materials. That's the first step. And then you do basically chemical and electrical processes to refine the material down to a high grade. So most of the smelting in the world is China. So this is really wild. So if China's getting choked on raw material, are they concerned about their Manufacturing. Are they concerned about their military production? Yes. So a lot of people are hearing about the Chinese have export controls on silver and they do. Why? It's because their feedstock is being, it's under pressure. So the US is us is basically locking down Western hemisphere. We can cover Greenland. You know, all, all this is, all this is really correlated to, to two things and I'm going to go with the military of the future is tech. It's, it's drones, it's heavy duty satellite. It's, I mean you can look up how, what metals go into a Tomahawk missile. If you don't have these minerals to do these things, you can't keep pumping, pumping things out. So China restricts their models on outbound. And so they're now reviewing who is buying the raw material, where is it going? And one of the big buyers was India. So India's like, wait, we can't buy as much as we need for our manufacturing from China right next door. So now India is on the open market buying silver as well. So, so here you have JP Morgan who says through a blanket and says it's not available. US then is pressuring raw material coming out of Latin America. China restricts. Now you see why silver is going up every day. That's this, it, it's, it's really this simple. And all the other factors we could talk about the monetary, the government spending. Yes. But this is why it's so acute and it's, why it's so happening. So I think I was, I think I, I posted today on X this, this is not going to stop until China in particular, China stops bidding. So when they come up for air and say we got enough for the moment, then we, we will probably see. You know, it's almost like who's going to blink first? Like how much do you have? And, but the thing is every time it's dipped a little bit, it gets bought up. And that's the other thing is that we're in mercantile banking. So if we have, if globalism is dead, we no longer trade. Well, you now have banks who sit in the middle. Most, many, many banks are multinational and so they will trade and buy. So a lot of these guys and a lot of these bankers can't even go on TV right now. They're not putting out research reports because they got, they have a, they have, they have an order in. And what that order is, Marty, is I have an order to buy so many of something I got to accumulate it quietly build a position. And so they're buying every day. Don't, don't let it go up too much. Let it come down and then they hit it again. So if you've got, and I think the US Government's probably involved in it too, because they put it on the strategic minerals. So they're probably buying, China's buying, JP Morgan's in the middle squeezing everybody. This is, it's, it's incredible. It's incredible. Watch. So I think I did a quick video about a week ago and said, hey, we were, I think in the 80s now we're at just over 100 today. And I'm like, this thing could go to 150, it could go to 50. It could happen all like in a matter of a week or two. It, it will be volatile. But I don't think, I think if we take a look at the whole complex, it's, it's really happened in all the minerals, all the metals and silver's just been running a structural deficit for years. It should, not this, it should not have been this cheap to begin with. And so if you look at cost of, to mine something, the, the, the primary silver miners have not been profitable for like forever, which is why the stocks have underperformed. And you kind of look forward, you go, well, it's just like farming, right? If farmers can't make money, they're going to stop growing crops. And then demand, if demand doesn't change but supply goes down, prices shoot up. So, yeah, that's kind of what's happening. That's what is probably the biggest driver right now.